SHREE KRISHNA WOOLEN MILLS P LTD Vs. UOI

JUDGEMENT

(1.) THE present application is directed against the award dated 29. 12. 1984 passed by the learned Arbitrator in a dispute between the Union of india/objector and M/s Shree Krishna Woolen Mills (Pvt.) Ltd. /contractor whereunder while the claims of the Union of India were dismissed, the claim of the contractor for balance 5% payment of the stores supplied to Union of India amounting to Rs. 73,554/- was allowed.

(2.) IN a nutshell, the relevant facts of the case are that the dgsandd/union of India awarded a contract on 9. 11. 1971 to the petitioner/contractor for supply of 50,000 blankets. The specifications for delivery were stipulated in the tender and the contractor was required to complete the delivery by 31. 12. 1971. The petitioner/contractor completed supplies of 37,000 blankets till 31. 12. 1971. Vide letter dated 1. 1. 1972, the union of India/objector extended the time granted to the petitioner/contractor and increased the quantity from 50,000 blankets to 1,00,000 blankets to be supplied by 31. 1. 1972. The petitioner/contractor supplied 99,995 blankets between 26. 11. 1971 to 29. 2. 1972. Out of the aforesaid supplies, 6,306 blankets were found by the Union of India/objector not to be as per the required specifications and the same were accepted with a price reduction of 2%, due to deviations. The said price reduction was accepted by the petitioner/contractor, vide letter dated 28. 2. 1972. As per Clause V (i) of the Contract, the consignee, namely, Union of India/ objector could exercise its right to reject the supplies within 45 days of such receipt. As the supplies of the blankets were made in a staggered manner from 26. 11. 1971 to 29. 2. 1972, the outer limit of 45 days even if calculated from 29. 2. 1972, expired on 15. 4. 1972. It is the admitted case of both the parties that till 15. 4. 1972, the Union of india/objector did not exercise its right of rejection. Rather, 95% of the value of the goods supplied were released to the petitioner/contractor. After a lapse of about 8 months, on 5. 12. 1972, the Union of India/objector intimated the petitioner/ contractor that they shall re-inspect the blankets supplied and called upon the petitioner/contractor to be present for the re-inspection.

(3.) AS per the Union of India/objector, after the re-inspection was conducted over a period of 12 days w. e. f. 9. 12. 1972 to 28. 12. 1972, defects were found in the blankets which could not be relaxed even as per the terms of relaxation. It is the case of the Union of India/objector that out of a quantity of 41,332 blankets which were re-inspected, only 39,923 blankets were finally recommended for acceptance under price reduction ranging between 5% to 50%, while the balance quantity of 1409 blankets were not found acceptable even under price reduction. It was contended that after re-inspection was conducted in the presence of the representative of the petitioner/contractor, a notice dated 23. 4. 1974 was served upon it informing the petitioner/contractor that 39,923 blankets were accepted, subject to price reduction and that the amount of price reduction in respect of the aforesaid quantity of blankets came to rs. 3,05,566/- which amount having already been released, was sought to be recovered from the petitioner/contractor. As far as the result of re-inspection in respect of 1409 blankets was concerned, the petitioner/contractor was conveyed that the result of re-inspection shall be intimated to it in due course.